32336 - Trustco Equity

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Summary of Investment Information

Project Number

32336

Company Name

TRUSTCO GROUP HOLDING (PTY) LTD

Date SPI Disclosed

Jan 22, 2013

Country

Namibia

Region

Africa

Projected Board Date

Mar 7, 2013

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Regional Industry - MAS Africa

Industry

Health, Education and Life Sciences

Previous Events

Approved : Aug 8, 2013
Signed : Aug 21, 2013
Invested : Aug 29, 2013

Sector

Other Training

Project Description

Established in 1992, Trustco Group Holdings (“Trustco” or the “Company”) is a Namibia based company with a focus on low income consumer finance services – particularly microinsurance and micro-student lending – distance education, and property. The purpose of the proposed project is to expand Trustco’s microinsurance activities into new countries in Sub-Saharan Africa and to strengthen the company’s balance sheet.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	20.27
Equity	10.14

Development Impact

The proposed investment will:
i) Enhance access to affordable insurance, reducing the risk of large expenditures that increase poverty
ii) Enhance the market''s perception of Trustco''s business model, making it easier for them to raise further capital. This will come via the positive debt issuer profile that would follow the successful bond issuance on the JSE as well as the increased profile through the Company''s presence on the main board of the JSE
iii) Support development of the corporate bond market for non-South African companies listing bonds on the JSE

IFC''s involvement in this project will:
- Provide Trustco with difficult to access long term capital to fund growth through a combination of equity and credit enhancement in a maiden capital market issuance for Trustco so as to strengthen the Company''s balance sheet and position it for growth.
- Help Trustco expand into new products and regional markets through IFC''s knowledge and expertise in consumer and microfinancing in the African markets that are of interest to the Company.
- Provide IFC''s "stamp of approval", enhancing investor confidence in the shares and boosting the profile of non-South African shares on the JSE as well as listed corporate bonds.

E&S Category Rationale / Risks and Mitigation

This project has been classified as FI-2 (medium risk) according to IFC’s Environmental and Social (E&S) Review Procedure. As noted above, the company’s main business focus is low income consumer finance services – particularly microinsurance and micro-student lending. Trustco owns two Pilatus PC12 aircrafts and one Learjet 45 whose operating and safety risks are known and adequately managed. Trustco has valid building Fitness Certificates and Fire Certificates for its existing buildings. The certificates which are issued after inspection by the Windhoek local Municipality are subject to renewal on an annual basis. Trustco also owns 3.6 million square meters of sellable land, which the Company refers to as the “Land Bank.” A portion of the existing land was zoned for residential and industrial developments, subdivided and provided with bulk infrastructure (roads, water, electricity and sewerage), and is currently being sold and transferred to new owners. Trustco successfully obtained approvals from the Townships Board, the Namibia Planning and Advisory Board – NAMPAB, and the Ministry of Environment and Tourism for the proposed residential and industrial developments. The remainder of the “Land Bank” will follow the same procedure for zoning and will obtain approvals from the relevant departments according to future use. The Township Board and NAMPAB are the main approval bodies for any development in Namibia.

Trustco’s core business activities have minimal or no adverse environmental or social impacts, and the Company complies with national requirements in developing its existing land. However, as set forth in the Environmental and Social Action Plan (ESAP), Trustco will implement a number of actions to strengthen its existing land acquisition and development processes and procedures to assess potential E&S risks and impacts for its future property development activities.

Refer to “Description of Main Environmental and Social Risks and Impact of the Project”.

Task Description	Anticipated Completion Date
Formalize existing land acquisition and development processes and procedures into a detailed environmental and social due diligence (ESDD) procedure to ensure compliance with applicable national E&S legal and regulatory requirements, IFC’s Performance Standards, Exclusion List and relevant WBG EHS Guidelines.	By April 30 2013
Appoint a suitably qualified E&S coordinator who will be responsible for developing and implementing the ESDD, and fulfilling the ESAP conditions, among other E&S responsibilities.	Condition of commitment
Submit the Terms of Reference (TOR) for the E&S coordinator and the draft ESDD to IFC for review.	Prior to commitment for TOR and by March 31 2013 for draft ESDD.

Contacts

For Inquiries About the Project, Contact

Adrian Bock
Trustco Group Holdings Ltd
Trustco House, 2 Keller Street
P O Box 11363
Windhoek
Namibia
Phone: +264-(0)61-275-4000
Fax: +264 (0)61 - 275 4090
http://www.tgi.na

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Local Access of Project Documentation

Trustco Group Holdings Ltd
Trustco House, 2 Keller Street
P O Box 11363
Windhoek
Namibia
Phone: +264-(0)61-275-4000
Fax: +264 (0)61 - 275 4090
http://www.tgi.na

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
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CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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